Speaking to the NZ Herald after the Government announced a tightening of immigration rules, Mr Little said Labour would go much further in order to give the country a "breather".
"The commitment I am making is we have to be serious about it, we have to cut immigration - it has got to be in the order of tens of thousands," Mr Little said.
"And it has got to be immigration that meets the genuine shortage of skills that we've got, not just the open slather policy we've got right now."
Asked by how much would Labour cut immigration, Mr Little said he did not have an exact number and flexibility was needed from year to year in order to match the right migrants with skill shortages.
He criticised Immigration Minister Michael Woodhouse for not being able to estimate how many people the package of changes announced yesterday would keep out of New Zealand.
"What I can't see from what they have announced is just what impact that is going to have. Right now the problem is we have tens of thousands - 70,000-odd new people coming to New Zealand each year, most of them settling in Auckland.
"You have a city that is absolutely packed to the gunnels, you see it in the congestion, you see it in not enough housing, you see it in overcrowded schools."
Prime Minister Bill English today hit back at Little's comments, saying they weren't realistic.
"We need the skills to get houses built for instance, and this is a party that is promising to build 100,000 houses - where are they are going to get the people to do it?
"We are trying to get a balance here between getting in the skills that we really need but making sure we have got the infrastructure to support the numbers."
Mr English said drastically cutting immigration was difficult when a significant driver was Kiwis returning from overseas. Asked if Labour was "vote hunting", he said the Opposition would always do that.
"And they seem to have trouble picking where they are going to hunt."
Labour is working on an immigration policy that could be released in the coming weeks. Last week Mr Little said there would be no cap on immigration, but rather a reduction in work visas granted in areas like laboring jobs.
Record migration, which is underpinning New Zealand's economic growth and putting pressure on infrastructure, has shown no sign of letting up and in the year to February was at a net level of 71,333.
The Government has argued strong immigration flows are a measure of the country's success and contribute positively to the wider economy.
However, in October Mr Woodhouse announced changes that meant those coming to New Zealand under the skilled migrant category would need 160 points before getting residency, rather than 140.
The number of people allowed entry under the family category was also more than halved, and a temporary ban on applications under the parent category was also announced.
And yesterday he unveiled another raft of changes - the last planned before September's election - including restricting skilled worker visas to those who will earn more than $49,000 once in New Zealand.
Not meeting threshold
In figures released to the Herald, a Ministry of Business Innovation and Employment sample of more than 600 skilled migrant category applications being considered as at March 1 found more than two in five would not have met the new income threshold.
Just 42.5 per cent of applicants earned over the New Zealand median income of $48,859 per year and 14 per cent earned over $75,000.
Kary Chung, a 22-year-old restaurant front-of-house manager, told the Herald that the changes will make it "impossible" for her to meet visa requirements under the skilled migrant category.
Originally from Hong Kong, Chung has been in New Zealand for five years, coming first as a high school student at Takapuna Grammar School and graduated last year with a Bachelor of International Hospitality Management degree from AUT University.
"I bring with me skills such as cultural knowledge and being fluent in Cantonese, Mandarin and of course English, which is vital in the hospitality industry here these days," Chung said.
"But the fact is, people in hospitality are not highly paid, and my current income will not meet the $49,000 mark."
Changes to start from August 14:
• Anyone who will earn less than about $49,000 a year once in New Zealand won't get a skilled migrant category visa, and permanent residents won't get points for such jobs.
• People who will earn more than $73,299 will automatically be classified as highly skilled.
• The SMC points table, under which individuals claim points towards their residence application, will also be realigned to give more recognition of skill levels in the 30-39 age group and high salary levels.
• Limiting lower skilled visa holders to a maximum of three years, after which a stand-down period will apply before another visa can be approved.
• Classifying the partners and children of these visa holders as visitors, meaning they will only gain work visas if they meet requirements in their own right.
• Ensuring the length of the visa in seasonal occupations aligns with peak labour demand, rather than for 12 months as is presently the case.
